20000530Order No 28383 mod.doc

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION OF INTERMOUNTAIN GAS COMPANY FOR AUTHORITY TO CHANGE ITS PRICES. )
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) CASE NO. INT-G-00-1

NOTICE OF APPLICATION
NOTICE OF MODIFIED
PROCEDURE
NOTICE OF COMMENT/ PROTEST DEADLINE
ORDER NO. 28383

YOU ARE HEREBY NOTIFIED that on May 19, 2000, Intermountain Gas Company (IGC; Company) filed an Application with the Idaho Public Utilities Commission (Commission) for authority to place into effect new rate schedules that would result in an overall increase of approximately $36.4 million (28%) in its annualized revenues. The increase reflects a change in the Companys cost of gas and the elimination and/or imposition of a number of temporary gas and transportation cost adjustments, surcharges and credits. The Company in its filing also proposes to balance out its Purchased Gas Cost Adjustment (PGA), Account 186. The PGA Account is a deferral mechanism for over- and under-collections and for realized savings on spot market gas purchases.
The proposed adjustments reflected in the Application include changes in costs billed IGC by Williams Gas Pipelines-West (WGP-W) and other transportation companies, the elimination of temporary surcharges and credits (INT-G-99-01), an increase in the Companys weighted average cost of gas (WACOG), the benefits generated from the Companys segmentation of its firm capacity rights on WGP-Ws system, the inclusion of temporary surcharges and credits relating to gas and transportation related costs from the Companys deferred gas cost account (PGA Account 186), and an updated customer allocation of gas-related costs.
The Application proposes implementation of the following permanent and temporary changes, adjustments, surcharges and credits to IGCs tariff rates for natural gas service, sales and transportation:

Permanent Adjustments:
 INT-G-99-01 Elimination of Temporary Surcharges/Credits ($2,267,042)
 Change in WGP-W rates/charges $ 369,305
 Change in storage costs $2,414,847
 Cost of Gas Supply $22,042,806
Temporary Surcharges or Credits
Deferred Gas Costs (IGC PGA Acct 186)
 Variable Cost Collection Adjustment ($ 816,540)
 Uncollected Gas Costs $17,307,308
 Market Segmentation ($2,408,551)
Fixed Gas Cost Misc ($ 40,176)
Expansion II Refund ($ 166,565)
As computed by the Company, the total requested increase in revenue on an annual basis is $36,435,392 or 27.66%. The net increase in sales gas revenues is $36,223,723 or 28.62%. The increase in T-1 transportation service revenues is $304,854 or 7.01%. The net increase in T-2 transportation service revenues is ($93,185) or (14.32%). The annualized change in rates by class of service per Company calculation is as follows:

Gas Sales
Revenue Avg Increase (Decrease)
/Therm Avg Increase (Decrease)
% Change Proposed Avg Price
$/Therm
RS-1 Residential
$6,548,887
17.811¢
27.95%
$0.81534
RS-2 Residential
$16,334,687
14.672¢
27.34%
$0.68341
GS-1 Genl Svc
$ 13,340,149
15.151
30.74%
$0.64442
LV-1 Large Vol. *
* T-1 tariff price plus the Weighted Average Cost of Gas (WACOG), $0.28673
(Compare WACOG INT-G-99-01: $0.18252)
WACOG = total commodity cost of gas  total purchase therms

Transportation
Revenue Avg Increase (Decrease)
/Therm Avg Increase (Decrease)
% Change Proposed Avg Price
$/Therm
T-1 Transp.
$304,854
0.628
7.01%
$0.09589
T-2 Transp.
($ 93,185)
(0.430)
(11.75%)
$0.03230
With the exception of the Industrial class, IGC proposes to allocate the change in rates to each of its customer classes in accordance with its Purchased Gas Cost Adjustment tariff and approved cost-of-service methodology. (Ref. Case Nos. INT-G-95-1, INT-G-88-2, U-1034-137). Because there are no fixed costs currently recovered in the tailblock of IGCs T-1 tariff and because the proposed increase in the T-1 tariff is related to fixed costs (except for TF-1 commodity charge), a cents-per-therm increase is made only to the first two blocks of the T-1 tariff. All three blocks of IGCs proposed T-1 tariff have been adjusted to include WGP-Ws firm transportation TF-1 commodity charge. The proposed increase in the T-2 tariff (except for TF-1 commodity charge) is fixed cost related and, therefore, a cents per therm increase was made only to the T-2 demand charge. The commodity charge component of the T-2 tariff was adjusted to include WGP-Ws firm transportation TF-1 commodity charge.
Intermountain Gas requests that its Application be processed under Modified Procedure, i.e., by written submission rather that by hearing. Reference Commission Rules of Procedure, IDAPA 31.01.01.201-204. The Company has requested an effective date of July 1, 2000.
YOU ARE FURTHER NOTIFIED that the Commission has reviewed the filings of record in Case No. INT-G-00-1. The Commission acknowledges that the rate increase requested is significant. The Commission notes that the annual PGA tracker reflects only those changes in gas costs that are generally recognized as outside the Company’s control. The Commission has preliminarily determined that the public interest may not require a hearing to consider the issues presented in this case, and that the issues raised by the Company’s filing may be processed under Modified Procedure. In so doing, the Commission notes that Modified Procedure and written comment has proven to be an effective means for obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that the Commission will not hold a hearing in this proceeding unless it receives written protests or comments opposing the use of Modified Procedure and stating why Modified Procedure should not be used. Reference IDAPA 31.01.01.203.
YOU ARE FURTHER NOTIFIED that given the size of the PGA rate increase requested in this case and the rate shock that may result from immediate implementation, comment is specifically solicited from Commission Staff and the Company as to whether the PGA methodology would be compromised by a phase-in of the increase over time. Any phase-in proposals should also be submitted. Related ramifications including fairness and equity should also be addressed.
YOU ARE FURTHER NOTIFIED that the deadline for filing written comments or protests with respect to the Application and the use of Modified Procedure in Case No. INTG00-1 is Friday, June 23, 2000. The Commission has extended the comment period beyond the standard 21 days to give the public additional time to provide written comment regarding the Company’s Application and the proposed increase. Reference IDAPA 31.01.01.202.02. Persons desiring a hearing must specifically request a hearing in their written protests or comments.
YOU ARE FURTHER NOTIFIED that if no protests or comments are received within the deadline, the Commission may consider the matter and enter its Order without a hearing. If protests or comments are filed within the deadline, the Commission will consider them and may set the matter for hearing or may decide the matter and issue its Order on the basis of the written positions before it. Reference IDAPA 31.01.01.204.
YOU ARE FURTHER NOTIFIED that written comments concerning this Application must be mailed to the Idaho Public Utilities Commission and the Intermountain Gas Company at the following addresses:
COMMISSION SECRETARY
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
Street Address for Express Mail:
472 W WASHINGTON ST
BOISE, ID 83702-5983 MICHAEL E. HUNTINGTON
VICE PRESIDENT
MARKETING AND EXTERNAL AFFAIRS
INTERMOUNTAIN GAS COMPANY
PO BOX 7608
BOISE, ID 83707

MORGAN W. RICHARDS, JR., ESQ.
PO BOX 829
BOISE, ID 83701
All comments should contain the case caption and case number shown on the first page of this document.
YOU ARE FURTHER NOTIFIED that the Application in Case No. INT-G-00-1 together with accompanying exhibits and workpapers can be reviewed at the Commission’s office and at the principal office of Intermountain Gas Company during regular business hours. Intermountain Gas Company is located at 555 South Cole Road in Boise, Idaho (377-6000).

O R D E R
IT IS HEREBY ORDERED and the Commission does hereby solicit public, Company and Commission Staff comment on the Company’s Application in Case No. INTG00-1 as more particularly described above, and in accordance with the foregoing schedule.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this _______ day of May 2000.

DENNIS S. HANSEN, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

PAUL KJELLANDER, COMMISSIONER

ATTEST:

Myrna J. Walters
Commission Secretary

vld/O:INT-G-00-1_sw

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
NOTICE OF COMMENT/PROTEST DEADLINE
ORDER NO. 28383 1

Office of the Secretary
Service Date
May 30, 2000